Uber cuts more than 400 engineering and product jobs
Uber has cut more than 400 engineering and product jobs, marking its second round of lay-offs since its tumultuous initial public offering in May.
The 27,000-strong company said in a statement on Tuesday that it had eliminated 265 positions from its engineering team and 170 from its product team, or roughly 8 per cent of the two teams.
The move is part of an attempt to centralise control and remain competitive. It follows a similar shake-up of the marketing department in July, in which a third of that team — 400 positions — were cut.
Uber has been under pressure since its May stock market debut, with investors questioning whether the car-booking business model will ever be profitable. In August, the company booked its largest quarterly net loss of $5.24bn, weighed down by IPO-related costs. Its shares rose 4 per cent at $33.51 on Tuesday, but are still well below the $45 IPO price.
“Previously, to meet the demands of a hypergrowth start-up, we hired rapidly and in a decentralised way,” the company said on Tuesday. “While this worked for Uber in the past, now that we have over 27,000 full-time employees in cities around the world, we need to shift how we design our organisations: lean, exceptionally high-performing teams, with clear mandates and the ability to execute faster than our competitors.”
The decision was made after chief executive Dara Khosrowshahi asked Uber’s management whether, if the company was starting from scratch, the teams would look as they did, Uber said.
Jobs were cut based on business needs, eliminating duplicate roles and overlapping work, as well as individual performance, said a person with knowledge of the situation. The majority of the roles affected — more than 85 per cent — are based in the US, the person said, adding that a hiring freeze put in place in August in the engineering and product division in some geographies has now been lifted.
Staff at Uber Eats, its food delivery service, and its freight service were not affected.
In an email to employees seen by the Financial Times, Mr Khosrowshahi said the company must “ship more quickly and operate more effectively and efficiently than we are today”.
“We are not doing this for Wall Street. We are doing this for Uber,” he wrote, adding: “It’s critical we get our edge back and continually push ourselves to do better. As a leadership team, we have been too slow to see inefficiencies and course-correct, and that’s on us.”